Citigroup’s (C) Chief Executive Officer (CEO) Jane Fraser has expressed support for cryptocurrencies and tokenized deposits.
Speaking to investors and analysts on the Wall Street bank’s third-quarter earnings call, Fraser acknowledged that cryptocurrencies such as Bitcoin (BTC) have gone mainstream.
She also said that tokenized deposits, not stablecoins, will likely drive next-generation payments and financial market infrastructure.
Fraser said that Citigroup’s institutional clients are asking for seamless, real-time cross-border money movement that is low-cost and efficient.
“That is best done by tokenized deposits,” she said.
New York-based Citigroup has invested heavily in digital asset infrastructure, including its own U.S. dollar clearing network.
Fraser said the bank’s tokenized services can now link to over 250 banks in more than 40 countries, enabling clients to transfer funds instantly to suppliers and third parties.
The CEO added that while Citigroup will continue to support stablecoins, they come with more operational difficulties than tokenized deposits.
Fraser explained that, despite their popularity, stablecoins have regulatory burdens around anti-money laundering, tax reporting requirements, and accounting due diligence.
“These other requirements are what our tokenized deposit capabilities avoid,” she said.
Fraser says that Citigroup is exploring the possibility of issuing its own stablecoin, but she cautioned against the current hype surrounding the digital asset.
“There’s an overfocus on stablecoin at the moment,” she said. “Most of this is going to get solved by tokenized deposit capabilities.”
Citigroup’s stock has risen 43% this year to trade at $99.84 U.S. per share.
